Literature review

This chapter describes what has been found in the earlier studies of neuromarketing. As mentioned earlier, the main topics of this thesis are neuromarketing, marketing and consumer behavior in Finland. Ethics of neuromarketing is also discussed as it has raised concerns among consumers and researchers; if a business chooses to conduct market research using neuromarketing as a tool, it might backfire and be harmful for the image and the brand.

When searching of existing information and research of neuromarketing, it came quite clear that this field is relatively new despite of rapidly grown amount of data and plentiful accessible publishes. However, most of the research and their findings concern the prevailing customer preferences abroad and thus must be critically considered whether they can be applied in Finland. A literature review is necessary to conduct as it is a tool for finding gaps or discrepancies in existing literature, giving headers to future research, exposing unsolved issues and finally, it can provide fresh perspectives (Imel 2011).

As a word, neuromarketing has not come up until early 2000’s, but methods of neuromarketing have been used many years earlier. Marketing has long traditions of investigating consumer behavior. According to Levallois, Smidts & Wouters (2019), it was a matter of time for neuromarketing to be born as new technologies and hunger to insights grew rapidly along swift cognitive neuropsychology and neuroimaging development. This eventually led to marketing academics familiarizing themselves with new method of functional magnetic resonance imaging (fMRI) used for brain scanning (Levallois et. al, 2019). Since those days, methods for neuroimaging (also shown in Figure 2.) has also grown into subsections and even more creative ways to gaining insights out of consumers.

In early 2000’s there is scattered literature about neuromarketing, as it had just emerged as a term and early research outline the possibilities and development of neuromarketing. Erk, Spitzer, Wunderlich, Galley & Walter (2002) ran a marketing research to examine brain stimuli when showing photos of different vehicles associated with wealth and social dominance. The outcome of this research proved that brain regions that are associated with reinforcement and reward (right ventral striatum, left orbitofrontal cortex, left anterior cingulate and bilateral prefrontal cortex) show higher activation when shown a picture of a sports car, rather than a small car. Even though this was not considered a “neuromarketing”

research, it merely scraped the surface on what could be discovered with more research and even more advanced technology.

The earliest usage of word “neuromarketing” seems to be in the summer of 2002 by a press release in courtesy of Atlanta advertising company BrightHouse. They launched a new division of the firm specializing in marketing research using fMRI machinery. (Fisher, Chin

& Klitzman 2010) According to Morin (2011), the first scholarly research of neuromarketing was conducted back in 2003 when Professor of Neuroscience Read Montague was trying to find out how brains handle choices of brands. Despite Montague ending up with reliable

conclusions on decision making in the test, he found out that different sections of brains activate on the grounds of whether test subjects know or do not know which brand they are consuming. The study furthermore suggests that especially strong brands could “claim”

pieces of humans’ frontal cortex. (Morin 2011) This, and many more ethical issues arise along development of neuromarketing, which are discussed later on.

In 2004, Emily Singer published an article on neuromarketing with an ominous title: They know what you want. This publishment underlines the concerns regarding manipulation and possession of consumers. As the field of neuromarketing had not shown any remarkable development over the few years, it is also discussed whether it is just another hoax or might it have the potential to identify consumer behavior. Overall, the article does not lean too heavily on scientific evidence but weighs ups and downs of the potential of neuromarketing as the future cannot be foreseen. (Singer 2004)

Fisher et. al. (2010) brings up the concerns over the free will of consumers. Because the majority of neuromarketing studies are commercial, the transparency is non-existent and could thus pose a threat to consumer autonomy drastically, not to mention professional and scientific concerns. This is a great example of a complicated issue on commercial ethics being applied with academic-industrial relationships. (Fisher et. al. 2010) Despite numerous amounts of concerns that neuromarketing has raised, Touhami, Benflakih, Jiddane, Cherrah, Malki & Benomar (2011) views the bright side: neuromarketing is not just for commercial usage but could also be used to guide consumers without monetary benefit. Neuromarketing might therefore be effectively used to progress sustainable development and social comfort through convincing sensitizing messages.

As the field of neuroimaging and -marketing had much potential and room for growth and development, the number of scientific articles proved that neuromarketing was not to be ignored. Neuroimaging has not been around for a long time, and neuromarketing even less and both of them are considered to be only in their infant stages. Marketers have just woken to countless possibilities of ways to finding information of consumers’ information seeking, product preferences and buying decisions (Morin 2011). Despite the method of EEG having been used for decades for marketing preferences, there seems to be little doubt that a new age had been entered (Murphy, Iles & Reiner 2008).

Lee, Broderick & Chamberlain (2006) state that there is no reason for neuromarketing not to benefit from the development of neuroimaging and that future research should focus on gaining understanding of human behavior. Neuroimaging in marketing could in fact also be used more cost efficiently than traditional marketing tools with possible hidden consumer preferences to be found and therefore seems like an attractive tool. However, Ariely & Berns (2010) doubt that neuromarketing will ever become more cost efficient and lucrative as traditional marketing tools, even though they admit that neuroimaging can have advantages in many domains of marketing. (Lee, Broderick & Chamberlain 2006, Ariely & Berns 2010) Although the studies of neuromarketing are mainly commercial and cannot be fully compared with academical studies, in 2011 there has already been enough evidence to prove neuromarketing functioning in action. A few core neurocognitive precepts have been recognized when advertising messages were exhibited to consumers (Morin 2011).

As discovering deep information about consumer preferences is a great part of neuromarketing, Karmakar & Yoon (2016) found out pointers to potential opportunities for measurement of neural activity. This basically meant that the ability to study consumer behavior showed progress as multiple brain areas could be examined to find “hidden”

information on preferences. For locating and uncovering insights from consumers Sung, Wilson, Yun & Lee (2019) also suggest a combination of neuromarketing, survey and qualitative techniques. These insights, along with consumers responses to specific type of marketing stimulus and psychological mechanism determining their preferences, even include the before mentioned “hidden” subconscious responses that consumers may not report or be aware of. Obeying the recommendations of neuromarketing studies have even shown to increase business traffic and the outcomes of marketing of companies (Sung et. al.

2019).

According to study by Lin et. al. (2018) especially the method of EEG could be deployed in a manner which would bring advantages to consumer research over traditional methods. This supports the statement of Karmakar & Yoon (2016) that consumer neuroscience provides complimentary features to traditional marketing- and research methods via analytics into concealed mechanisms that are not available through basic observations. For example, Lin et. al. (2018) suggest that the temporal precision of EEG also provides researchers the tools for capturing deep insight concerning marketing topics such as brand, pricing and advertising.

Because of evolving technology, the costs are declining in the field of neuromarketing which leads for the companies to gain accruing access into consumer insights (Sung et. al. 2018).

Today these insights can be done with relatively affordable setting costs and machinery of EEG and therefore it is suggested that the method will attract popularity among academics and businesses (Lin et. al. 2018). According to Sung et. al. (2018), these businesses will most likely harvest the rewards over their competitors. Another key point along low cost - which makes EEG suitable for lab and field experiments - is its minimally-evasiveness and movability when obtaining findings and recommendations regarding the improvement of marketing decisions (Bazzani, Ravaioli, Trieste, Faraguna & Turchetti 2020).

Today neuromarketing has spread into unpredictable measures and basically, it is not discussed whether neuromarketing can be a useful tool, but rather what is the best way to utilize it and whether it is cost efficient. Karmakar, Shiv & Knutson (2015) discovered that during a purchase decision, the order of acquired information can change the mechanisms in product evaluation in addition with possibly affecting product selection behavior. Their study also suggests that products are evaluated by if they are worth their price rather than if it is liked or disliked. Even the buy/not to buy button in the brain is beginning to take shape as Jai, Fang, Bao, James, Chen & Cai (2020) found that the choice of consumer could be foreseen accurately through brain activity while consumer is evaluating the product. In commercial usage this information can be used for example in deciding the most efficient presentation of products in online shopping (Jai et. al. 2020). The method of neuromarketing provide us the tools to see inside consumers’ brains for hidden information, therefore providing the possibility to discover the “black box” of consumers (Sung et. al. 2018).